Why didn’t you shut it down sooner, Bernanke?
“Mortgage delinquency and foreclosure rates have increased substantially over the past year and a half,” Mr. Bernanke said during a speech in Washington. “Behind these disturbing statistics are families facing personal and financial hardship and neighborhoods that may be destabilized by clusters of foreclosures.”
From the NY Times
Well, duh.
Of more interest is the comment that 1.5 million homes entered foreclosure last year and there are another 1.5 million subprime loans that will have their rates reset this year. There’s a lot more pain to come, and not just for homeowners. Bear Stearns, one of the big players in the subprime mortgage market is now looking for a bailout from JPMorgan.
When this is all over, and I guarantee the Fed won’t be the architect of it’s resolution, many homeowners might be battered, but they’ll carry on. Some of the big lenders that facilitated the credit bubble won’t be carrying on, they’ll be absorbed or shut down, which is the way things should be.